Encouraging words for district energy from UK government

The UK heat and power industry is hoping that its Big Offer programme of proposals can persuade government to back district heating throughout Britain and it heard encouraging words from the government’s Energy Secretary on Thursday.

The Big Offer was presented at the UK Combined Heat and Power Association’s conference to Ed Davey on Thursday and Deputy Director Ian Manders said he hoped that it would help the rest of the UK follow London’s example, which has seen significant investment in the development in the schemes in the capital.
Mr Davey used the occasion to announce a £1m allocation of funding towards four cities’ feasibility studies into district heating initiatives.

Amongst suggestions included in the Big Offer are that government extend heat mapping to produce reports that show areas most suitable for such schemes. The reports can be then used to analyse areas of high density buildings for local authorities in particular to identify for district heating.

There is also contained a purchasing framework focused on bringing schemes to hospitals, universities and defence forces campuses. Currently 32 universities and 64 hospitals around the country are benefitting, with more in the offing.

Ian Manders believes community district heating schemes can double if the conditions are created, and part of that is about the industry organising itself and preparing to be legislatively and structurally capable of handling accelerated development.

“There are a number of other things we can do as an industry as it shouldn’t be all about the government. The major thing is we are an unregulated energy utility so we are going to introduce a form of self regulation.

A district heating site will join up to the voluntary scheme – they will have to have a customer charter which is approved by the customer protection scheme, which will include fair pricing and treatment of customers.

Like any voluntary scheme we are hoping that the respective planning authorities will write into their local plan that any district heating site must join a a nationally recognised customer protection scheme, recognised by DECC in England or the Scottish government in Scotland.”

Most of the big offer is about exploiting things as they are at the moment.

Mr Manders says it is vital that the industry is supported in achieving utility rates of capital investment if it is to thrive and help the country achieve its carbon emission reduction targets.

“In many ways we are more attractive to government in terms of loan guarantee schemes: than the roads, bridges and the like because we have a revenue stream from the heat charges so we can actually fund the payback. The government has a commitment to reducing carbon emissions in the UK and this is a relatively straightforward and proven way of doing that.”

DECC is developing the actions related to its Heat Strategy to be published by March 2013, and the CHPA are making this offer at this time so it can be incorporated in those actions.

CHPA estimate that the Big Offer short-term measures will produce district heating projects worth £300m ($475m) in capital investment, leading to the creation of over 7,000 jobs, mainly in the construction phase.